Why it’s great
Using Nexmo Verify allows you to improve the customer experience and protect your platform or application on a global scale.Presenter: Sri Srinivasan, Product Leader
Srinivasan is currently a product leader for verify and number insight at Nexmo. Previously, he held product marketing positions at Druva, Motorola, RIM, and Qualcomm. He holds an MBA from Kellogg.LinkedIn

Cloud communications startup Nexmo is now Nexmo, a Vonage company, after being acquired by communications giant Vonage for $230 million.

The company’s CEO Tony Jamous is now president of the newly acquired entity. CTO Eric Nadalin and Nexmo’s 170-person team are also moving over to Vonage.

Nexmo brings 350 enterprise customers from across the globe, which marks Vonage’s first expansion outside of the United States.

Vonage CEO Alan Masarek comments on the acquisition, “By combining Vonage’s rapidly growing, unified communications-as-a-service business with Nexmo, we are creating the future of cloud communications. These companies represent a set of strategic, technology and human resources assets that deliver the broadest services offering in our industry.”

Adding better verification technology to banking and financial apps is a balancing act. One the one hand, there’s necessary friction that deters unauthorized access. On the other hand, however, too much friction quickly turns user experiences into user ordeals. In its Finovate debut in London earlier this year, Nexmo, a worldwide leader in cloud communications, demonstrated its solution to this challenge: an SDK that enables developers to add phone verification to their apps with a single function call.

Nexmo says its Verify SDK is the only white-label solution that “manages user identities across multiple devices and platforms without building a complex user-management backend and adds a new level of security by tying phone numbers to unique device IDs.”

“At Nexmo we’ve built a verification solution, which is a turnkey product, available as an SDK, that allows you to seamlessly build strong authentication solutions inside your mobile banking app,” Nexmo Product Lead Parth Awasthi explained from the Finovate stage. Nexmo’s security solution focuses on the triumvirate of verification—something you have, something you know, and something you are—leveraging passwords, unique device IDs, TouchID, and more to provide consumers with the most friction-free, multifactor authentication possible.

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We spoke with Awasthi during conference week at FinovateEurope. Then we followed up with a few questions by email for more about Nexmo, its Verify SDK, and what to expect next from the company. Awasthi has been with Nexmo since 2014, and was previously a program manager at Microsoft.

Finovate: What problems does Nexmo solve?

Parth Awasthi: Nexmo is a global cloud-communications platform leader providing innovative communication APIs and SDKs for voice, text, messaging and phone-verification services. Nexmo enables applications and retailers to communicate with their customers reliably and with ease, no matter where in the world they are located, effectively increasing efficiency, enhancing customer service and reducing overall processing costs.

Finovate: Who are your primary customers?

Awasthi: Nexmo has more than a hundred thousand customers, and they are primarily from the fintech BitGold; retail/ecommerce like Alibaba; transportation/travel/hospitality like Airbnb; gaming like Garena and social markets like Viber.

Finovate: How does Nexmo’s technology solve the problem better?

Awasthi: Nexmo’s cloud communications APIs and SDKs are incredibly easy to implement and leverage the power of Nexmo’s unique global cloud communications platform. Only Nexmo has hundreds of direct-carrier relationships to reduce latency while using its Adaptive RoutingTM algorithm to continuously calculate millions of data points and find the most efficient route in near real-time. This all allows Nexmo to deliver messages with unmatched speed, efficiency and reliability rates.

Finovate: Tell us about your favorite implementation of your technology.

Awasthi: Our Verify SDK that I presented at Finovate London is a really cool product, and the way that Call Levels used it was pretty interesting. The Verify SDK is a turnkey solution that texts a one-time password to help verify the identity of someone. Call Levels—a financial monitoring service that sends immediate, strategic investment information—used the SDK to verify a customer from any device they want to use. This is a cool balance of safekeeping a person’s financials without making the barrier to entry too difficult.

Finovate: What in your background gave you the confidence to tackle this challenge?

Awasthi: We have verified more than 3.5 billion numbers, and help massive companies like WeChat verify users daily. This was a challenge that we were well prepared for.

Finovate: What are some upcoming initiatives from Nexmo that we can look forward to over the next few months?

Awasthi: We are constantly improving our performance through updates to our Adaptive Routing algorithm and making new direct-to-carrier relationships, and will be adding new features in the near future. Stay tuned to Nexmo.com for the latest news!

Finovate: Where do you see Nexmo a year or two from now?

Awasthi: In 2015, we nearly doubled the volume of our business (measured by API calls) and maintained a close focus on customer support, achieving an average customer satisfaction level of more than 85%. We’re looking forward to continuing this growth and pushing the boundaries of cloud communications right into 2018.

To dig a bit deeper, we recently spoke with the San Francisco-based company’s CEO, Tony Jamous. Prior to founding Nexmo in 2010, Jamous worked at Paymo, which was acquired by BOKU in 2009.

In his interview, Jamous spoke with us about the inspiration for Nexmo, the company’s competitive advantages, and its challenges.

Finovate: What was the impetus behind creating Nexmo?

Jamous: Nexmo was created to reduce the barriers to entry for developers to innovate with communication technologies and enable scalable and global high-quality communication infrastructure. Imagine how hard it would have been for Airbnb, one of our global customers, to individually connect to more than 200 carrier networks using arcane telecommunications protocols.

Early on, we were obsessed with building networks and investing in cloud technologies to sustain quality of network as our customers scaled their businesses. Nexmo uniquely connects our customers’ traffic as closely to carriers as is physically possible to reduce message and call latency. We also measure quality feedback for every transaction and adapt how each message or voice call is being routed in real time to continually improve overall quality.

Finovate: Your solutions are used in a number of industries. What is unique about the communications and fraud problems in the financial services sector?

Jamous: The phone number has emerged in recent years as a user-friendly way to identify and authenticate real people. Our APIs, especially Verify (pictured below) and Number Insight, are designed to enable financial services players to easily embed two (or more) factor authentication, and gather data on the phone number during the transaction. These tools enable financial service providers to reduce fraud without the need to gain expertise in teleco rules and regulations.

Finovate: What is the most creative solution you’ve seen a financial services company build using a Nexmo API?

Jamous: Bitcoin platforms have been driving innovation in fraud prevention at a faster rate than any other segment within the fintech space, and Nexmo works with many of the leading bitcoin companies.

To secure your bitcoins from theft, enabling phone-number two-factor authentication with the Nexmo Verify SDK or API is strongly recommended. This involves sending a one-time password (OTP) to a user over a separate communication channel (SMS or voice) rather than the IP channel (internet) used by the bitcoin exchange or wallet. Aside from sending payments, phone-number verification can also be required for registration, login, resetting passwords and authenticating changes made to your [specific] bitcoin exchange or wallet account. Bitcoin theft might be irreversible, but you can prevent it with an extra layer of protection using Nexmo’s Verify API or Verify SDK.

Finovate: What are the biggest challenges for Nexmo?

Jamous: Nexmo has reached a phase in which we need to both scale the business and improve operational efficiency, all while keeping a priority on customer-facing teams and tools. We have a long journey ahead, which will be both challenging and exciting for the team.